BT Tops Earnings Estimates on High-Speed Internet and TV
BT Group Plc (BT/A)’s third-quarter profit before some items exceeded analysts’ estimates as the U.K’s largest Internet service provider won more users for its television and high-speed broadband service.
Adjusted earnings before interest, taxes, depreciation and amortization rose 1.6 percent to 1.55 billion pounds ($2.5 billion) in the three months ended Dec. 31, London-based BT said today in a statement. Analysts had predicted 1.53 billion pounds, data compiled by Bloomberg show. Revenue, excluding the impact of a regulatory decision, fell 6 percent to 4.51 billion pounds, matching the average estimate by analysts.
BT is countering a decline in sales of traditional phone services with a 2.5 billion-pound fiber-optic buildout for faster Web speeds and expanding its TV offers. The former phone monopoly added 60,000 subscribers for YouView since the video- on-demand service went on sale in October, and this summer, BT will release its new sports channel, which will feature Premier League soccer and Premiership rugby matches.
“Our fiber plans are helping to make the U.K. a broadband leader in Europe,” Chief Executive Officer Ian Livingston said in the statement today. “This gives us an excellent platform for our push into TV and sport later this year.”
YouView also offers catch-up TV, allowing viewers to see the latest episode of shows from the British Broadcasting Corp., ITV Plc (ITV), Channel 4 and Channel 5, before the next airs.
The shares rose 6.5 percent to 264.8 pence in London. The stock has risen 28 percent in the past 12 months, giving the company a market value of 20.9 billion pounds.
BT reiterated its forecast that revenue will improve in the second half through March, compared with the first half. The company has said sales trends for the full year won’t improve.
The company also said a regulatory decision regarding a dispute over historic Ethernet pricing will cut revenue by 100 million pounds to 200 million pounds in the years ending in March 2013 and 2014. BT excludes charges related to this decision in its adjusted revenue figure.
To contact the reporter on this story: Amy Thomson in London at email@example.com